Louisiana-Pacific owns approximately 330,000 acres of land in Mendocino County. Probably 90% of this land is zoned Rangeland-Agricultural Preserve or Timberland Production Zone (TPZ). According to LP's own figures, 80% of their timber inventory resides on 20% of their land; 50% of inventory is on 5% of their land. (LP's Sustained Yield Plan 1997) Put another way, 0-10,000 board feet per acre (averaging 5,000 bfa) is on 140,000 acres of LP land while 60,000 board feet per acre exists on less than 5,000 acres. Essentially, most of what's left are extremely cut over lands, with a few remaining pockets of Old Growth, mostly in the Albion River Watershed.
Efforts to encourage this timber king to slow the cut over the past two decades met with callous disregard and manipulative tactics. Discussion on forest practice rules for Mendocino County, initiated by environmentalists in the late 1980's in the form of the Forest Advisory Committee (FAC), became framed as "jobs vs. the environment" by an industry posturing as victimized.
Timber forecasts brought to the FAC's attention in 1990 foretold of industry moving away from the Western states and back to the South where fifth generation forests are becoming ready for harvest. Nonetheless, Louisiana-Pacific succeeded in maintaining the status quo of high-yield extraction while confusing and polarizing the real issues. Long-term economic health and workplace safety were always integrated in environmentalists' demand for ecologically sound timber practices. Corporate interests have continually used emotional phrasing to obfuscate sound science and delay or derail positive public discussion towards responsible resource management.
The day after LP's announcement of the sale of their California holdings, Greg Giusti, U.C. Forestry consultant, made a proposal that was covered in the Press Democrat: a Public Trust could be formed to own and manage LP timberlands for commercial, sustainable timber production. The Board of Supervisors considered this idea until County financial advisor Mike Scannell's fiscal warnings and rumored phone calls from unknown watchful outsiders about the socialist implications of such an idea discouraged them. Piqued interest nonetheless evolved into the current pursuit: the development of a non-profit public benefit corporation to bid on the LP lands alongside other corporate bidders. The Board of Supervisors is assisting this project by devoting some staff time for the research necessary to produce a viable financial packet. Naturally, the final decision will be made by Louisiana-Pacific.
LP is asking for the first round of bids on their entire Mendocino County holdings (west of Hwy 101) including the mills, on December 23rd. At this point they have not indicated if they will be selling portions of their land holdings, and if so, which ones. At least one other timber company will be bidding: the Soper-Wheeler Corporation announced its intentions recently. Other potential and speculated bidders are, of course, Simpson, Weyerhauser, Sierra Pacific and Pacific Lumber. Included in the first round of bids will be the as-yet-unnamed non-profit public benefit corporation.
So far, nine individuals have volunteered to form the board of this non-profit: Walter Smith, Greg Guisti, Pete Passof, Henry Gundling, Charles Peterson, Art Harwood, Linda Perkins, Meca Wawona and an unnamed representative from the Pacific Forest Trust. Of primary consideration for this group is the need to quickly identify its charter, file for non-profit status, and - most essential - develop an economically feasible plan for acquisition and management.
There is the possibility that either the Institute for Sustainable Forestry or Trust for Public Lands will step in as the group's sponsor for the interim while the new non-profit is launched. According to Joe Euphrat and Dwight Nager of U.S. Forest Capital, a private investment consultant firm, the most viable economic plan would involve the sale of tax-free bonds created specifically for public benefit corporations. This plan for raising the large investment capital required would reduce the debt load by one half.
Tax-free bonds work by the leverage of collateral assets. As of yet, the legislative language does not specify timber as an asset. New wording is being drafted to fulfill this purpose, but would require legislative and executive approval. It would be necessary, therefore, for Trust for Public Lands or some other beneficent entity to buy the LP lands in order to hold open this opportunity for a public benefit corporation. Considering the time frame, this idea is a long shot which is being pursued with the expectation that if this opportunity is missed, future chances may come up as depleted inventories inevitably cause other major timberland owners to sell out.
Of ironic interest to some readers, the Mendocino County Forest Rules, created in 1992 by the Forest Advisory Committee (and denied by the Calif. Board of Forestry) are currently being proposed as the tentative basis for investment payback offers. This means that, among other guidelines, debt repayment will be constrained by a managed harvest of 2% of inventory per year, with area controls of only a certain percentage of any given watershed being harvested at one time.
The requirement for a public benefit corporation as established by tax-free bonds legislation is that the profits from such an entity, after debt repayment (in 40+ years?), must be used for publicly beneficial purposes: libraries, schools, recreation, etc. Envisioning Mendocino County forestlands held and managed in such a manner and for such purposes into the future demands a reframing of current extractive resource management practices. Perhaps one day it will be clear that the health of our local forest-dependent economies is indeed itself dependent upon the long-term ecological health of the forest.
Copyright Mendocino Environmental Center 1997
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